Cargo clearance backlog defies Uhuru’s three-week ultimatum

Three weeks ago, President Uhuru Kenyatta directed government agencies involved in clearance of goods at the Inland Container Depot (ICD) in Nairobi to expedite the release of hundreds of containers held at the facility.

The goods are mainly owned by small traders who cannot afford to import full consignments so they pool them into a container, in what is known in the shipping industry as consolidation.

However, after the expiry of the deadline on June 17 and with a huge number of the containers yet to be released, it is now clear that the goods may not be released that easily.

The Kenya Revenue Authority (KRA) must collect import taxes as shipping lines and Container Freight Stations (CFSs) claim more than Sh100 million in storage charges accrued over the past seven months.

On Friday, Nairobi Importers and Small Traders Association chairman Ben Mutahi said they were in talks with relevant agencies to seek solutions to the complex procedure of releasing the goods. The biggest challenge they are facing is that some clearing and forwarding agents had gone underground and failed to show up to clear their goods, he said.

“There are 500 containers whose owners we have not identified while shipping lines and CFS storage charges keep rising,” he said.

Mr Mutahi, however, said that they had held discussions with cargo clearance agency officials to address the challenges.

It also emerged that at least 200 containers were moved from the ICD to private yards after the President made the announcement, where they are accruing storage charges. Some clearing and forwarding agents have also claimed that the President’s intervention was political and that it was intended to cool the temperatures of protesting traders.

“There is confusion because, when the President announced that containers should be released, some of them were taken to these private yards where they have been attracting charges of more than $100 (Sh10,000) each per day each,” said an agent who requested not to be named.

“Who is going to pay those charges because, even though they are talking about a waiver, no private business will agree to release any container without their money. I think importers are just being tossed left, right and centre and it is unfair. If it is not possible to release the goods, we should be told the truth we seek other alternatives,” said the agent.

However, Commissioner of Customs and Border Control Kevin Safari said they were engaging with the traders and assured them that the process would be fast-tracked with KRA waiving charges for local inspection and those they owe the Kenya Ports Authority (KPA).

“We have so far cleared 100 containers and identified 600 more that we are processing. But even as we have waived the storage charges, the import taxes must be paid in full because the imports were not duty-free,” Mr Safari said.

“The challenge we face is that some of the traders fear to come out in the open and claim their goods because they think it is a trap. But what we are telling them is that as long as they are engaged in legitimate business we have no problem; the reason we have also given them office space at the ICD where they are operating from,” he told Sunday Nation in a telephone interview.

Kenya International Freight and Warehousing Association (Kifwa) national chairman Roy Mwanthi said the association expected the traders who sought the President’s intervention to go back to the Head of State and find a way of solving the impasse.

“The traders had trust and confidence in the President, the reason they went to him. At this high level of engagement, Kifwa does not intend to interfere but we hope the traders will be issued with relevant waivers,” he said.

Clearing agents have also complained of stringent checks on their consignments, despite having obtained a certificate of conformity from authorised agents in the countries of source.

Some goods have to be subjected to checks at the port or IDC, raising questions over why inspection is done at the source country.

The Kenya Bureau of Standards appointed five inspection agencies — Bureau Veritas S.A, Intertek International Limited, China Certification and Inspection Company Limited, SGS and Cotecna Inspection SA.